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The tech giant scrapped certain completed watches because of an error in some so-called taptic engines, which produce the sensation of being tapped on the wrist, the Journal wrote. Apple previously told some suppliers to ease up on watch production until June without explaining its rationale, sources told the publication.
Apple told CNBC's Josh Lipton that it had no comment.
The report said that some taptic engines made by Chinese company AAC Technologies broke down over time. The company could not immediately be reached for comment.
Apple first took orders for the device earlier this month and started to ship them Friday. The Journal said that it was not aware of Apple shipping any watches with the faulty component.
The taptic engine is designed to give notifications in a less bothersome way than buzzing or ringing.
Apple shares closed more than 1 percent lower on Wednesday.
The Apple Watch has had a mixed reception from consumers and Wall Street. Watch sales were not included in the tech giant's recently reported quarterly results as the device went on sale after the period ended.
Even without the new product, Apple on Monday posted earnings and revenue that topped analysts' estimates. The company sold 61.17 million iPhones in the quarter, beating expectations.
Still, the stock has been sluggish since the report, which included an announcement that Apple would expand its capital return program to $200 billion from a previously announced $130 billion.